Hi All,
Over the last two weeks I have read the 0-130 and 0-260 books, great reading. I'm continuing to dig around this site and suss it all out. I'm not working forever…
My questions is, applicable to my situation.. I have one apartment (neg geared) which was all done under first home owners and finished off that way. I'm now back home with parents as I can't afford the mortgage.
Through age and stupidity I'm slowing climbing out of a mass pile of personal, consumer debt. Still a way to go but in another 18 months, and apart from my car (passion) I'm free once again.
With little to no "cash on hand" how do you make a start with the investing and the growing of wealth?
Not having the thousands needed for legal / transaction costs, let alone a deposit, and a unit with 18% equity (in thy own name) does pose a challenge.Any help or advice would be grearly appreciated.
Cheers
What are the consumer debts, and what interest rate are you being charged on them?
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
SAVE, save, save. Get a second job.
How much is that passion (car) worth? What's it costing you in terms of money and missed opportunities.
If you have a debt attached to it then it is stopping you from moving forward any time soon. Decide what's more important.
Otherwise sit back and wait years for your property to grow and access equity (slow) choice.
Hi bluehoon
Yep, consumer debt can hurt!
With your current property, can you add value to it through renovations and create some equity (instead of waiting for it).
Have you had a depreciation schedule prepared? This will bolster your tax return and assist with paying down some of that “bad” debt. Also make sure the rent you’re currently receiving is in line with the current market.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Jamie M wrote:Have you had a depreciation schedule prepared? This will bolster your tax return and assist with paying down some of that “bad” debt. Also make sure the rent you’re currently receiving is in line with the current market.Nice one Jamie.
Hi All,
Thank you for your advice and feedback. I'm getting the depreciation schedule set up at the moment and working through this aspect. Rent is at current Market rates.
Guess I'll have to keep paying down the debts to get more cashflow, for now.
Thank You!!
Hi bluehoon
In the past, a couple of newbies have used their "shoe leather" to find us deeply discounted properties. We call them "bird dogs". It's not easy and initially you'll get a lot of knock backs from us because the properties are only discounted from the "asking" price, not the "market" price.
It's not pretty and it's not easy but it sure did wonders for these bird dogs' knowledge of the market and they did make money out of it. It's amazing the education you'll pick up when you get out into your chosen market and talk to a lot of people in that market. Let us know if you find one. Preferably a 3+ bedroom plus garage, "standard" free standing house, not in a "war zone"
Cheers, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
Haha, I can see Paul now being inundated with hundreds of emails from a flock of new Bird Dogs
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Pardon my asking.. What are bird dogs…? Not sure what the inference above is about.
Bird dogs are people who find good deals and then sell them onto other investors for a set price as they usually don't have the money to buy the deal themselves.
Hi BlueHoon
I might suggest that you are in a great position.. Keep your head up!
It may not seem like it and your "bad" debt might be tough but ill add to the others comments as best i can..
You have a -Geared property so therefore your Tax return is just around the corner.. I suggest this goes into your debts one at a time to get rid of them completely.. (lowest loan amount vs highest interest rate..!)
You also are able to make the payments on the bad debt and therefore once its gone have room for additional good debt..?
You are like me and learn the hard way, but your budget is now sorted, (whether you know it or not) you now know what you need to live off and the rest is paying off all the loans..
In future this will only change from "Bad" to "Good" and wealth will create itself if given the right opportunities..
Now the hoon part.. As a self confessed hoon ill add that valuable hands on experience starts with cars.. you learn that anything is possible, fixable and of course if you pay others its expensive.. also great for learning to negotiate a great deal!! use this knowledge, transfer it to property and your on a winner..
Learn from this experience and you wont end up in it again..
You really wont like this bit and it depends on the car but if you sold it and paid off the loan.. Then made 100k on property, would you buy the same car back? If not, sell it and wait until you buy what you want later for cash!! (this will be hard to swallow)
If needed you can get your tax back weekly next FY and use the extra each week to pay off your debt sooner..
By the sounds of it you are probably best to do it tough and kep your return next year as a part deposit in your next IP.. (forced savings)
Hope that all makes sense..!
Im a dumb leco so any financial advice is from experience only.. Get paid professional advice!!
I agree – get rid of the car. The running costs of the car (insurance, registration, servicing, petrol, repairs) are high. Free up the cash to clear the debts and re-evaluate later.
Jacqui Middleton | Middleton Buyers Advocates
http://www.middletonbuyersadvocates.com.au
Email Me | Phone MeVIC Buyers' Agents for investors, home buyers & SMSFs.
bluehoon wrote:Pardon my asking.. What are bird dogs…? Not sure what the inference above is about.Check out Paul’s thread above – I was making reference to that.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Yup, ditch the car. Replace it with a new passion –> Become really really ridiculously wealthy. (Or similar)
Lease a fleet of exotic cars later under some sort of company/trust tax arrangement. Then you can change them like you change your underwear. If that floats your boat.
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